KUALA LUMPUR (Aug 3): Property developer UEM Sunrise Bhd has acquired a 21-storey office tower in Melbourne, Australia, for A$58 million (RM161 million), which it plans to convert into a luxurious residential development.
In a statement today, UEM Sunrise said the purchase of the office tower on 412 St Kilda Road — which measures some 16,000 sq m — is the company’s third property acquisition in the city, following its purchase of two central business district (CBD) sites on LaTrobe Street and Mackenzie Street in October 2013.
The 16,000 sq m office tower is located at a strategic corner site of St Kilda Road, one of the main routes into the Melbourne CBD. It is currently occupied by the Victorian Police and will be vacated after mid-2016.
“The intention of this acquisition is to develop ‘an unprecedented ultra-luxurious residential development’, potentially with a mix of ground floor retail and serviced apartment components. The Company will continue to evaluate the market condition in order for the development to meet future market demands,” said UEM Sunrise.
Its managing director cum chief executive officer Anwar Syahrin Abdul Ajid said: “The decision to acquire the 412 St Kilda Road site is part of our strategy to ensure steady flow of overseas projects. The property is in a different location from the two core CBD sites we currently own. Being in the city fringe, it promises a different lifestyle and thus, will appeal to a different market segment.”
With the overwhelming sales of the group’s maiden venture, Aurora Melbourne Central’s residential units last year, and the impending launch of its second project, Conservatory on Mackenzie Street in the upcoming months, he said the latest acquisition is timely and will strengthen the momentum of the UEM Sunrise’s pipeline projects in Melbourne.
The group also noted that the strong economic fundamentals of Australia and the steady population growth in Melbourne of 1,800 people per week, based on the Australian Bureau of Statistics figures released in March 2015, translates into a housing demand of almost 900 units per week.
“... the World’s Most Liveable City remains a key focus of the company in strengthening its overseas portfolio,” said UEM Sunrise.
Apart from Melbourne, UEM Sunrise is also actively pursuing development opportunities in other key cities in Australia such as Sydney as well as in London, United Kingdom.
The property developer also has presence in Vancouver, Canada, and retains a land bank in Durban, South Africa.
It has also appointed project manager (marketing) for M+S Pte Ltd, a development company owned by Khazanah and Temasek, for its Marina One and DUO mixed-use developments in Singapore.
As at 3.42pm, UEM Sunrise (fundamental: 1.5; valuation: 2.6) was traded 1 sen or 1.03% lower at 96.5 sen, with a market capitalisation of RM4.38 billion.
The counter has been on a downward trend of late. Year-to-date, it has declined about 29.57%.
(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)